I'm in Corporate Finance course and I am struggling in a question of bond valuation. Face...

I'm in Corporate Finance course and I am struggling in a question of bond valuation. Face Value = $1,000.00, Annually coupon rate = 7%, Initial market interest rate = 9%, YTM = 10, Payment per year = 1, Hence, Price value = $871.65.

I have to make a table of bond valuation which shows the impact of changes in interest rate over the life of a bond for each year of maturity. The value of the bond, year by year, from date of issue until its maturity, assuming that market interest rate increases by 1.5% (hence yield to maturity increases by 1.5%), all other things remain the same.

the maturity is 10

Expert Solution

jeff jeffy answered 4 months ago

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